North America Leads in Airline Profitability

Innovations, efficiencies and savvy promotion – a good recipe!

According to the latest statistics released by IATA, North American airlines saw demand rise 3.2% in 2015, broadly unchanged from the growth achieved in 2014. Capacity rose 3.1%, edging up load factor 0.1 percentage points to 81.8%. US domestic traffic climbed 4.9% last year, helped by solid economic growth. This was the fastest rate of increase since 2004 and the first time since 2003 that domestic traffic growth surpassed international growth. The load factor reached a domestic record high of 85.4%.

The recently released IATA report on airline profitability indicates that North American carriers are leading the industry’s performance and are expected to generate considerably more than half the industry’s total profits in both 2015 ($19.4 billion) and 2016 ($19.2 billion). On a per passenger basis, profits of $21.44 in 2016 also place their performance at the top of the industry.

This is as a result, says IATA, of a strong US economy, the appreciating US dollar, lower oil prices and a restructured industry. Capacity growth by North American airlines is expected to accelerate from 3.7% in 2015 to 4.8% in 2016 on the strength of the US economy.

AMERICAN AIRLINES INTRODUCES PREMIUM ECONOMY ON INTERNATIONAL ROUTES

Later this year, American Airlines will introduce Premium Economy on international routes with the delivery of its new Boeing 787-9 Dreamliner – raising the bar even higher and providing more choices for global travellers. The airline is investing more than $2 billion in fully lie-flat seats; international Wi-Fi; more inflight entertainment options and power outlets; a new, modern design for Admirals Club lounges worldwide; and an upgraded assortment of complimentary healthy food, cocktails and more. This is in addition to American’s historic fleet renewal, which has delivered 215 new aircraft since 2014 and more than 90 new planes are expected in 2016.

SURFING MID ATLANTIC

Since last month, Delta Air Lines have been offering a high-speed internet connection on board all their transatlantic flights between the United States and Europe, Israel and West Africa.

CAPACITY GROWTH BY NORTH AMERICAN AIRLINES IS EXPECTED TO ACCELERATE FROM 3.7% IN 2015 TO 4.8% IN 2016

“We already offer Wi-Fi on all our domestic flights and we are delighted to extend this service to our transatlantic passengers, providing them with the opportunity to work, to stay connected and surf the internet throughout their flight,” said Nat Pieper, Senior Vice President Europe, Middle East and Africa. “More than 93% of our international fleet provides access to the internet and we will continue to use technology to make the flights more productive for our customers when they travel with Delta.”

GOING THE EXTRA MILES

United Airlines has announced that it will introduce daily nonstop flights between its San Francisco International Airport hub and Singapore’s Changi Airport, effective June 1, 2016, subject to government approval. United will be the first airline to offer nonstop service between San Francisco and Singapore, and this will be the only nonstop service to the U.S. from Singapore. United will use the Boeing 787-9 Dreamliner, to operate the service. Measured by distance, the San Francisco – Singapore service will be the longest scheduled 787 flight operated by any airline and the longest scheduled flight operated by any U.S. carrier, at 8,446 miles.

BRITISH AIRWAYS ANNOUNCES NEW US ROUTES

Sun-drenched Silicon Valley is to get a direct service to Heathrow when British Airways starts offering nonstop flights to San José in Summer 2016.

British Airways (active partners of Brand USA in its now famed MegaFams) will offer daily flights on the only service between Europe and San José, the airline’s fourth Californian destination, after Los Angeles, San Diego and San Francisco, on its brand new 787-9 Dreamliner. The new service – BA279 – starts on May 4, 2016.

Meanwhile, British Airways customers flying from Gatwick will soon be able to wing their way directly to the US East Coast as the airline starts direct flights to New York in May this year. From May 1st, British Airways will fly customers in style from less than £400 return, to the city that never sleeps. Customers will travel on a three-cabin Boeing 777, offering a choice of 40 seats in Club World, 24 in World Traveller Plus and 216 in World Traveller. It will make British Airways the only airline to offer flights to New York from all three of London’s main airports; Gatwick, Heathrow and London City